The UK has threatened to impose punitive duties on US goods if Washington does not lift Trump-era tariffs on British steel and aluminium.
Britain’s trade minister Anne-Marie Trevelyan has told US trade representative Katherine Tai and Gina Raimondo, the US commerce secretary, that London was ready to increase existing retaliatory duties on high-profile US goods including whiskey, cosmetics and clothing.
On a trip to Washington, Trevelyan told US officials she was also looking at expanding the range of US products that would be subject to punitive tariffs if the administration of US President Joe Biden refused to cancel the measures put in place by his predecessor, Donald Trump.
In a public consultation held last year, the UK suggested it could target lobsters, grapes, chocolate, orange juice and electric motors imported from the US.
“We don’t want to use countervailing measures, but we’re getting a lot of pressure domestically to say that this is unfair,” a senior UK official said, referring to the US tariffs on UK steel and aluminium imports imposed in 2018.
The UK was isolated after the US and EU agreed to suspend tariffs on steel and aluminium in October. The deal provided relief from Trump-era tariffs of 25 per cent on steel and 10 per cent on aluminium to EU manufacturers, but leaves UK steelmakers at a disadvantage because they still face steep duties on exports to the US.
The FT reported last week that the US is delaying a deal to remove the tariffs on UK steel and aluminium because of Washington’s concerns about London’s threats to change post-Brexit trading rules in Northern Ireland.
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Brussels and Washington have repeatedly warned UK Prime Minister Boris Johnson that unilaterally changing the EU-UK accord that sealed Britain’s exit from the bloc could threaten peace on the island of Ireland.
The issue has attracted the attention of a substantial Irish diaspora in the US Congress, which has repeatedly called on the UK to honour the 1998 Good Friday Agreement that ended the region’s three-decade-long conflict.
Trevelyan met Richard Neal, the top Democrat on trade in the House of Representatives and a member of the Congressional “Friends of Ireland” caucus, as part of her trip.
In a statement following their meeting, Neal said he emphasised his full support for the Good Friday Agreement, as well as expressing “interest in deepening bilateral trade and investment ties” with the UK.
UK hopes for a post-Brexit free trade agreement with the US have dimmed after the Biden administration made it clear that trade deals were not a legislative priority as it focused on its domestic economic agenda.
However, progress has been made on one longstanding dispute. In June, the US struck deals with the UK and EU to suspend tariffs on each others’ goods for five years over subsidies given to aircraft makers Boeing and Airbus.
In a statement following the meeting, Trevelyan said she had invited Raimondo to London in January to “make progress on this issue”.
“We have been clear all along that resolving this dispute is the right thing to do,” Trevelyan said. “It will benefit workers and businesses on both sides of the Atlantic, and would remove the need for the UK to levy retaliatory tariffs on US goods.”